Navigating the Intersection of Residential and Commercial Real Estate

Residential Realtors® encounter opportunities to step into the commercial real estate industry every day, according to Fredrick Buehler, executive director for Elite Advantage Real Estate Academy and an NAR/REBAC educator. Buehler shared ways residential Realtors® can diversify their portfolios and step into the resimercial market during a recent PAR webinar. 

What is resimercial? 

“When people hear the term ‘resimercial,’ it sounds a little funny, but that was what it was classified as before,” Buehler said. “They often think it’s some new niche market or something new in the real estate industry, but the reality is that most Realtors® are already encountering some sort of resimercial opportunities every single day. They just don’t recognize them as much.” 

“At its core, resimercial is where residential and commercial real estate intersect, and it’s a space where the traditional real estate residential clients are making decisions that have commercial implications, even where commercial principles can be applied to the residential transaction.”  

What are the challenges? 

Buehler noted that there’s often a misconception that commercial real estate is reserved for a select group of specialists. 

“In reality, every Realtor® can benefit from understanding commercial concepts,” he said, adding, “Most Realtors® are very capable of learning the new forms and documents that may be required. The real challenge is learning the new language, and more importantly, changing the way we think about real estate.” 

“Residential agents are accustomed to looking at properties through the eyes of a homeowner. Commercial practitioners, however, look at the property through the eyes of an investor.” 

Rather than focusing on the affordability, commercial practitioners focus more on the annual performance of that property. For residential Realtors® getting into commercial transactions, learning the new language and changing the way they see business is the hardest part. 

How can residential Realtors® get started in the commercial market? 

“Start by learning the language of commercial real estate and surrounding yourself by people who are already doing it,” Buehler advised, encouraging prospective commercial Realtors® to join their local boards and chapters and engage in networking opportunities. 

He encouraged them to join: 

• Certified Commercial Investment Member Institute (CCIM)
• Institute of Real Estate Management (IREM)
• Society of Industrial and Office Realtors® (SIOR)

He also added that many Realtors® think they have to start in the commercial space by listing office buildings or shopping centers, but in reality, it can be easier to start with duplexes, triplexes, mixed-use buildings and other more familiar territory.  

“You don’t have to jump into the deep end,” he reminded. “You can go into the small end first. But you have to be competent in your craft.” 

What advice would Buehler offer to somebody just starting in the commercial industry? 

Buehler’s top tips were: 

1. Be patient with the process. Just like any sector of real estate, you’ll hit roadblocks, but it’s important not to get frustrated and discouraged. 
2. Start small. Small things lead to bigger things.  
3. Create your network. Start making contacts now. 
4. Understand what you’re doing. You don’t have to do everything, but you should fully understand everything you’re doing. 
5. Comply legally and ethically. Just because the transactions are bigger, doesn’t mean they’re treated differently. Comply with the Code of Ethics, license law and usual rules.  

Ready to begin your resimercial business? 

Learn more from Buehler, including additional resources for new commercial Realtors®, by viewing the webinar recording.